n-14 wm blair - sec.gov | home no. 333-108399 as filed on october 29, 2003 u.s. securities and...

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0000881453-03-000267.txt : 200310290000881453-03-000267.hdr.sgml : 2003102920031029140512ACCESSION NUMBER:0000881453-03-000267CONFORMED SUBMISSION TYPE:N-14/APUBLIC DOCUMENT COUNT:6FILED AS OF DATE:20031029

FILER:

COMPANY DATA:COMPANY CONFORMED NAME:AMERICAN SKANDIA ADVISOR FUNDS INCCENTRAL INDEX KEY:0001035018FISCAL YEAR END:1231

FILING VALUES:FORM TYPE:N-14/ASEC ACT:1933 ActSEC FILE NUMBER:333-108399FILM NUMBER:03963153

BUSINESS ADDRESS:STREET 1:ONE CORPORATE DRIVECITY:SHELTONSTATE:CTZIP:06484BUSINESS PHONE:8006286039

MAIL ADDRESS:STREET 1:ONE CORPORATE DRIVECITY:SHELTONSTATE:CTZIP:06484

N-14/A1pr3wmblair-pre1.htm

n-14 wm blair

File No. 333-108399

As filed on October 29, 2003

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM N-14 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 |X| Pre-Effective Amendment No. 1 Post-Effective Amendment No. |_| (Check appropriate box or boxes)

American Skandia Advisor Funds, Inc.

(Exact Name of Registrant as Specified in Charter)

(203) 926-1888 (Area Code and Telephone Number)

One Corporate Drive Shelton, CT 06484 Address of Principal Executive Offices: (Number, Street, City, State, Zip Code)

Edward P. Macdonald, Esq. Assistant Secretary, American Skandia Advisor Funds, Inc. One Corporate Drive Shelton, CT 06484 Name and Address of Agent for Service: (Number and Street) (City) (State) (Zip Code)

Copies to:

Robert K. Fulton, Esquire Stradley, Ronon, Stevens & Young, LLP 2600 One Commerce Square Philadelphia, PA 19103-7098

Approximate Date of Proposed Public Offering: As soon as practicable after this Registration Statement becomes effective under the Securities Act of 1933, as amended.

Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until theregistrant shall file a further amendment which specifically states that this Registration Statement shall thereafter becomeeffective in accordance with the provisions of Section 8(a) of the Securities Act of 1933 or until the Registration Statement shallbecome effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

Title of the securities being registered: Shares of common stock of the ASAF William Blair International Growth Fund ofAmerican Skandia Advisor Funds. No filing fee is due because Registrant is relying on Section 24(f) of the Investment Company Act of1940, as amended.

AMERICAN SKANDIA ADVISOR FUNDS, INC. ASAF DeAM INTERNATIONAL EQUITY FUND and the ASAF AMERICAN CENTURY INTERNATIONAL GROWTH FUND One Corporate Drive P.O. Box 883 Shelton, Connecticut 06484

IMPORTANT PROXY MATERIALS PLEASE VOTE NOW

Dear Shareholder: October 10, 2003

I am writing to ask you to vote on an important proposal whereby the assets of the ASAF DeAM International Equity Fund (the "DeAMInternational Fund") and the ASAF American Century International Growth Fund (the "American Century International Fund") would beacquired by the ASAF William Blair International Growth Fund (the "William Blair International Fund" and together with the DeAMInternational Fund and the American Century International Fund, the "Funds"). The proposed acquisition is referred to as amerger. The Funds are each a series of American Skandia Advisor Funds, Inc. ("ASAF"). A shareholder meeting for the DeAMInternational Fund and the American Century International Fund are scheduled for November 21, 2003. Only shareholders of the DeAMInternational Fund and American Century International Fund will vote on the acquisition of the DeAM International Fund's andAmerican Century International Fund's assets by the William Blair International Fund.

This package contains information about the proposal and includes materials you will need to vote. The Board of Directors of ASAFhas reviewed the proposal and recommended that it be presented to shareholders of the DeAM International Fund and the AmericanCentury International Fund for their consideration. Although the Directors have determined that the proposal is in the bestinterests of shareholders, the final decision is up to you.

If approved, the proposed merger would give you the opportunity to participate in a larger fund with similar investment policies.In addition, shareholders are expected to realize a reduction in both the net and gross annual operating expenses paid on theirinvestment in the combined fund. The accompanying proxy statement and prospectus includes a detailed description of theproposal. Please read the enclosed materials carefully and cast your vote. Remember, your vote is extremely important, no matterhow large or small your holdings. By voting now, you can help avoid additional costs that would be incurred with follow-upletters and calls.

To vote, you may use any of the following methods:

o By Mail. Please complete, date and sign your proxy card before mailing it in the enclosed postage paid envelope. Votes must bereceived prior to November 21, 2003.

o By Internet. Have your proxy card available. Go to the web site indicated on your proxy card. Enter your 12-digit controlnumber from your proxy card. Follow the instructions found on the web site. Votes must be entered prior to 4 p.m. on November20, 2003.

o By Telephone. Have your proxy card available. Call the toll-free number on your proxy card. Enter your 12-digit controlnumber from your proxy card. Follow the instructions given. Votes must be entered prior to 4 p.m. on November 20, 2003.

If you have any questions before you vote, please call us at 1-800-SKANDIA. We are glad to help you understand the proposal andassist you in voting. Thank you for your participation.

/s/Judy Rice

Judy A. Rice

President

This page has been intentionally left blank.

AMERICAN SKANDIA ADVISOR FUNDS, INC.

ASAF DeAM INTERNATIONAL EQUITY FUND And the ASAF AMERICAN CENTURY INTERNATIONAL GROWTH FUND One Corporate Drive P.O. Box 883 Shelton, Connecticut 06484

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

To our Shareholders:

Notice is hereby given that a Special Meeting of Shareholders (the Meeting) of the ASAF DeAM International Equity Fund (the "DeAMInternational Fund") and the ASAF American Century International Growth Fund (the "American Century International Fund," andtogether with the DeAM International Fund, the "Funds") will be held at 100 Mulberry Street, Gateway Center Three, 14th Floor,Newark, New Jersey 07102, on November 21, 2003, at 11:00 a.m. Eastern Standard Time, for the following purposes:

1. For shareholders of the Funds, to approve or disapprove a Plan of Reorganization under which the Funds will transfer all oftheir assets to, and all of their liabilities will be assumed by, the ASAF William Blair International Growth Fund (the "WilliamBlair International Fund"). In connection with this proposed transfer, each whole and fractional share of each class of the Fundsshall be exchanged for whole and fractional shares of equal net asset value of the same class of the William Blair InternationalFund and outstanding shares of the Funds will be cancelled.

2. To transact such other business as may properly come before the Meeting or any adjournments of the Meeting.

The Board of Directors of American Skandia Advisor Funds, Inc., on behalf of the Funds, has fixed the close of business onSeptember 19, 2003 as the record date for the determination of the shareholders of the Funds, as applicable, entitled to noticeof, and to vote at, the Meeting and any adjournments of the Meeting.

/s/Edward P. Macdonald

Edward P. Macdonald

Assistant Secretary

Dated: October 10, 2003

prospectus/proxy statement TABLE OF CONTENTS

Page ----

Cover Page CoverSUMMARY...................................................................................................................2- ------- The Proposal...........................................................................................................2 ------------ Shareholder voting.....................................................................................................2 ------------------COMPARISONS OF IMPORTANT FEATURES OF THE FUNDS............................................................................3- ---------------------------------------------- The investment objective and strategies of the Funds...................................................................3 ---------------------------------------------------- Other non-fundamental investment policies of the Funds.................................................................4 ------------------------------------------------------ Fundamental investment restrictions of the Funds.......................................................................5 ------------------------------------------------ Risks of investing in the Funds........................................................................................5 ------------------------------- Federal Income Tax Considerations......................................................................................6 --------------------------------- Management of the Company and the Funds................................................................................6 ---------------------------------------Fee Arrangements..........................................................................................................7- ---------------- Distribution Plan......................................................................................................8 ----------------- Valuation..............................................................................................................8 --------- Purchases, Redemptions, Exchanges and Distributions....................................................................8 --------------------------------------------------- Fees and expenses......................................................................................................9 ----------------- Fees and expenses.....................................................................................................12 -----------------REASONS FOR THE TRANSACTION..............................................................................................21- ---------------------------INFORMATION ABOUT THE TRANSACTION........................................................................................22- ---------------------------------Closing of the Transaction...............................................................................................22- --------------------------Expenses of the Transaction..............................................................................................22- ---------------------------Tax Consequences of the Transaction......................................................................................22- ----------------------------------- Characteristics of the William Blair International Fund shares........................................................23 --------------------------------------------------------------- Capitalization of the Funds and Capitalization after the Transaction..................................................24 ---------------------------------------------------------------------VOTING INFORMATION.......................................................................................................26- ------------------ How to vote...........................................................................................................27 ------------ Solicitation of voting instructions...................................................................................27 ------------------------------------ADDITIONAL INFORMATION ABOUT THE COMPANY AND THE FUNDS...................................................................27- ------------------------------------------------------PRINCIPAL HOLDERS OF SHARES..............................................................................................28- ---------------------------EXHIBITS TO PROSPECTUS/PROXY STATEMENT...................................................................................29- -------------------------------------- EXHIBIT A..............................................................................................................1 --------- Form of Plan of Reorganization......................................................................................1 ------------------------------ EXHIBIT B..............................................................................................................1 --------- Prospectus dated March 1, 2003......................................................................................1 ------------------------------ EXHIBIT C..............................................................................................................2 --------- ANNUAL REPORT dated OCTOBER 31, 2002................................................................................2 ------------------------------------ EXHIBIT D..............................................................................................................3 --------- SUPPLEMENTS DATED MAY 16, 2003, AUGUST 1, 2003, SEPTEMBER 16, 2003 AND OCTOBER 2, 2003..............................3 --------------------------------------------------------------------------------------

AMERICAN SKANDIA ADVISOR FUNDS, INC. One Corporate Drive P.O. Box 883 Shelton, Connecticut 06484

PROSPECTUS/PROXY STATEMENT dated October 10, 2003

Acquisition of the Assets of the

ASAF DeAM International Equity Fund and the ASAF American Century International Growth Fund

By and in exchange for shares of the ASAF William Blair International Growth Fund

This Prospectus/Proxy Statement is furnished in connection with a Special Meeting (the "Meeting") of shareholders theASAF DeAM International Growth Fund (the "DeAM International Fund") and the ASAF American Century International Growth Fund("American Century International Fund") (each, an "Acquired Fund" and collectively, the "Acquired Funds"), each a series ofAmerican Skandia Advisor Funds, Inc. (the "Company"), called by the Company to approve or disapprove a Plan of Reorganization (the"Plan"). If shareholders of the Acquired Funds vote to approve the Plan, you will receive shares of the ASAF William BlairInternational Growth Fund (the "William Blair International Fund" and, together with the Acquired Funds, the "Funds") of theCompany equal in value to your investment in shares of the DeAM International Fund and/or the American Century International Fund,as the case may be, as provided in the Plan and described at greater length below. The Acquired Funds will then be liquidated anddissolved.

The Meeting will be held at 100 Mulberry Street, Gateway Center Three, 14th Floor, Newark, New Jersey 07102 on November21, 2003 at 11:00 a.m. Eastern standard time. The Board of Directors of the Company is soliciting these proxies on behalf of theAcquired Funds. This Prospectus/Proxy Statement will first be sent to shareholders on or about October 20, 2003.

The investment objective of each Fund is to seek capital growth. The William Blair International Fund and the AmericanCentury International Fund invest primarily in equity securities of foreign companies, while the DeAM International Fund investsprimarily in equity securities of foreign companies represented in the MSCI EFAE(R)Index.

This Prospectus/Proxy Statement gives the information about the proposed reorganization and issuance of shares of theWilliam Blair International Fund that you should know before investing. You should retain it for future reference. Additionalinformation about the William Blair International Fund and the proposed reorganization has been filed with the Securities andExchange Commission ("SEC") and can be found in the following documents:

|_| The Prospectus for the Funds dated March 1, 2003 is enclosed with and considered a part of this Prospectus/Proxy Statement.

|_| A Statement of Additional Information ("SAI") relating to this Prospectus/Proxy Statement dated March 1, 2003 has been filed with the SEC and is incorporated by reference into this Prospectus/Proxy Statement.

You may request a free copy of the SAI relating to this Prospectus/Proxy Statement or other documents related to theCompany without charge by calling 1-800-752-6342 or by writing to the Company at the above address.

The SEC has not approved or disapproved these securities or passed upon the adequacy of this Prospectus/Proxy Statement.Any representation to the contrary is a criminal offense.

Mutual fund shares are not deposits or obligations of, or guaranteed or endorsed by, any bank, and are not insured by theFederal Deposit Insurance Corporation or any other U.S. government agency. Mutual fund shares involve investment risks, includingthe possible loss of principal.

SUMMARY

This is only a summary of certain information contained in this Prospectus/Proxy Statement. You should read the morecomplete information in the rest of this Prospectus/Proxy Statement, including the Plan (attached as Exhibit A) and the Prospectusfor the Funds (attached as Exhibit B).

The Proposal

You are being asked to consider and approve a Plan of Reorganization that will have the effect of combining each of theAcquired Funds and the William Blair International Fund into a single Fund. If shareholders of the DeAM International Fund voteto approve the Plan, the assets of the DeAM International Fund will be transferred to the William Blair International Fund inexchange for a then equal value of shares of the William Blair International Fund. If shareholders of the American CenturyInternational Fund vote to approve the Plan, the assets of the American Century International Fund will be transferred to theWilliam Blair International Fund in exchange for a then equal value of shares of the William Blair International Fund.Shareholders of each Acquired Fund will have their shares of the Acquired Fund exchanged for William Blair International Fundshares of equal dollar value based upon the values of the shares at the time the Acquired Fund's assets are transferred to theWilliam Blair International Fund. After the transfer of assets and exchange of shares have been completed, the Acquired Fundswill be liquidated and dissolved. The proposed reorganization is referred to in this Prospectus/Proxy Statement as the"Transaction."1 As a result of the Transaction, you will cease to be a shareholder of an Acquired Fund and will become ashareholder of the William Blair International Fund.

For the reasons set forth in the "Reasons for the Transaction" section, the Board of Directors of the Company hasdetermined that the Transaction is in the best interests of the shareholders of the Acquired Funds and the William BlairInternational Fund, and also concluded that no dilution in value would result to the shareholders of any of the Funds as a resultof the Transaction.

The Board of Directors of the Company, on behalf of the Acquired Funds and the William Blair International Fund, has approved thePlan and unanimously recommends that you vote to approve the Plan.

Shareholder voting

Shareholders who own shares of an Acquired Fund at the close of business on September 19, 2003 (the "Record Date") willbe entitled to vote at the Meeting, and will be entitled to one vote for each full share and a fractional vote for each fractionalshare that they hold of an Acquired Fund. To approve the Transaction for the reorganization of the DeAM International Fund, theaffirmative vote of the holders of a majority of the total number of shares of capital stock of the DeAM International Fundoutstanding and entitled to vote thereon must be voted in favor of the Plan. To approve the Transaction for the reorganization ofthe American Century International Fund, the affirmative vote of the holders of a majority of the total number of shares ofcapital stock of the American Century International Fund outstanding and entitled to vote thereon must be voted in favor of thePlan.

Please vote your shares as soon as you receive this Prospectus/Proxy Statement. You may vote by completing and signingthe enclosed ballot (the "proxy card") or over the Internet or by phone. If you vote by any of these methods, your votes will beofficially cast at the Meeting by persons appointed as proxies.

You can revoke or change your voting instructions at any time until the vote is taken at the Meeting. For more detailsabout shareholder voting, see the "Voting Information" section of this Prospectus/Proxy Statement.

1 Please note there is a separate Plan for each Acquired Fund, the terms of which are substantially similar. For clarity ofpresentation, this combined Prospectus/Proxy Statement refers to each separate reorganization of an Acquired Fund into the WilliamBlair International Fund as the "Transaction."

COMPARISONS OF IMPORTANT FEATURES OF THE FUNDS

The investment objective and strategies of the Funds

This section describes the investment policies of the Acquired Funds and the William Blair International Fund and thedifferences between them. For a complete description of the investment policies and risks of the William Blair InternationalFund, you should read the Prospectus for the Funds that is enclosed with this Prospectus/Proxy Statement.

The investment objectives of the Funds are identical--each Fund's investment objective is to seek capital growth. Theinvestment objectives for the Funds are non-fundamental policies and can be changed without shareholder approval.

The American Century International Fund and the William Blair International Fund invest primarily in equity securities offoreign issuers. The DeAM International Fund invests primarily in equity securities of foreign companies represented in the MSCIEFAE(R)Index. Each Fund pursues its investment objective through various investment strategies that are employed by the Fund'ssub-advisor ( "Sub-advisor").

The DeAM International Fund will invest, under normal circumstances, at least 80% of the value of its assets in equitysecurities. The Fund pursues its investment objective by normally investing in the equity securities of companies in developedcountries outside the United States that are represented in the MSCI EAFE(R)Index, which tracks stocks in Australia, Austria,Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal,Singapore, Spain, Sweden, Switzerland and the United Kingdom. The Sub-advisor employs an investment strategy that seeks tomaintain a fund of equity securities which approximates the market risk of those stocks included in the MSCI EAFE(R)Index, butwhich outperforms the index through active stock selection. The targeted tracking error of this Fund is 4% with a normaldeviation of +/- 1%. It is possible that the deviation may be higher.

The DeAM International Fund's strategy employed by its Sub-advisor of attempting to correlate a stock fund's market riskwith that of a particular index, in this case the MSCI EAFE(R)Index, while improving upon the return of the same index throughactive stock selection, is called a "managed alpha" strategy. In managing the DeAM International Fund, the Sub-advisor emphasizesstock selection. The Sub-advisor considers a number of factors in considering whether to invest in a stock, including earningsgrowth rate, analysts' estimates of future earnings and industry-relative price multiples. Other factors are cash flow growth aswell as earnings and price momentum. The Sub-advisor generally takes a "bottom up" approach to building the Fund, searching forindividual companies that demonstrate the best potential for significant earnings.

The American Century International Fund will seek to achieve its investment objective by investing primarily in equitysecurities of international companies that the Sub-advisor believes will increase in value over time. For purposes of the Fund,equity securities include common stocks, preferred stocks and convertible securities. Under normal conditions, the AmericanCentury Fund will invest at least 65% of its assets in equity securities of issuers from at least three countries outside of theUnited States. While the Fund's focus will be on issuers in developed markets, the Sub-advisor expects to invest to some degreein issuers in developing countries.

The American Century International Fund's Sub-advisor uses a growth investment strategy to look for companies whoseearnings and revenues are growing at an accelerating pace. The Sub-advisor tracks financial information for thousands ofcompanies to research and selects the stocks it believes will be able to sustain accelerating growth. The Sub-advisor believesthat, over the long term, the stocks of companies with accelerating earnings and revenues have a greater-than-average chance toincrease in value. The Sub-advisor recognizes that, in addition to locating strong companies with accelerating earnings, theallocation of assets among different countries and regions also is an important factor in managing an international portfolio.For this reason, the Sub-advisor will consider a number of other factors in making investment selections, including the prospectsfor relative economic growth among countries or regions, economic and political conditions, expected inflation rates, currencyexchange fluctuations and tax considerations.

The William Blair International Fund will invest, under normal circumstances, at least 80% of the value of its assets insecurities of issuers that are economically tied to countries other than the United States. Equity securities include commonstocks, preferred stocks, warrants and securities convertible into or exchangeable for common or preferred stocks. The WilliamBlair International Fund has the flexibility to invest on a worldwide basis in companies and organizations of any size, regardlessof country of organization or place of principal business activity. The Fund normally invests primarily in securities of issuersfrom at least five different countries, excluding the United States. Although the William Blair International Fund intends toinvest substantially all of its assets in issuers located outside the United States, it may at times invest in U.S. issuers and itmay at times invest all of its assets in fewer than five countries or even a single country.

The William Blair International Fund invests primarily in companies selected by the Sub-advisor for their growthpotential. The Sub-advisor generally takes a "bottom up" approach to choosing investments for the Fund and seeks to identifyindividual companies with earnings growth potential that may not be recognized by the market at large, regardless of where thecompanies are organized or where they primarily conduct business. Although investments held by the William Blair InternationalFund may appear thematic, the Sub-advisor generally selects securities without regard to any defined allocation among countries,geographic regions or industry sectors, or other similar selection procedure.

Each Fund thus pursues its objective in a different manner. The DeAM International Fund tracks the MSCI EAFE(R)Index,while the American Century International Fund and the William Blair International Fund do not track any particular index. Each ofthe Sub-advisors for the DeAM International Fund and the William Blair Fund employ a "bottom up" investment approach, whereas theAmerican Century International Fund generally employs a blend of "bottom up" and "top down" methodologies. Each of the Funds,however, generally invests in equity securities of foreign issuers.

Other non-fundamental investment policies of the Funds

As noted above, each Fund invests primarily in equity securities of foreign companies. Under certain circumstances, eachFund may invest a portion of its assets in other types of investments or employ alternative investment strategies. In general,each Fund may invest in options and futures, currency hedging transactions and other derivative instruments. As described morefully below, each Fund may have limitations on the extent to which it may pursue these types of investments. In general, theAcquired Funds are more limited in their ability to pursue these types of investments, while the William Blair International Fundhas the most flexibility to pursue alternative investments.

The DeAM International Fund may invest in options on securities and securities indices, which options may be listed fortrading on a national securities exchange or traded over-the-counter. Options transactions may be used to pursue the Fund'sinvestment objective and also to hedge against currency and market risks, but are not intended for speculation. The DeAMInternational Fund may engage in financial futures transactions on commodities exchanges or boards of trade in an attempt to hedgeagainst market risks In addition to options and financial futures, the DeAM International Fund may invest in a broad array ofother derivative instruments including forward currency transactions and swaps in an effort to manage investment risk, to increaseor decrease exposure to an asset class or benchmark (as a hedge or to enhance return), or to create an investment positionindirectly. The types of derivatives and techniques used by the Fund may change over time as new derivatives and strategies aredeveloped or as regulatory changes occur.

The American Century International Fund may invest in bonds, notes and debt securities of companies and obligations ofdomestic or foreign governments and their agencies. The American Century International Fund will limit its purchases of debtsecurities to investment grade obligations. The American Century International Fund may also invest in derivative securities.Certain of these derivative securities may be described as "index/structured" securities, which are securities whose value orperformance is linked to other equity securities (as in the case of depositary receipts), currencies, interest rates, securitiesindices or other financial indicators ("reference indices"). The Fund may not invest in a derivative security unless thereference index or the instrument to which it relates is an eligible investment for the Fund. The Fund may also enter intonon-leveraged stock index futures contracts and may make short sales "against the box."

To protect against adverse movements in exchange rates, the American Century International Fund may, for hedging purposesonly, enter into forward foreign currency exchange contracts. In addition, the Fund may invest up to 10% of its assets in certainforeign countries indirectly through investment funds and registered investment companies that invest in those countries. If theFund invests in investment companies, it will bear its proportionate share of the costs incurred by such companies, including anyinvestment advisory fees.

The William Blair International Fund may invest in debt securities, including bonds rated below investment grade by theprimary rating agencies (so-called "junk" bonds), mortgage and asset-backed securities and zero coupon, pay-in-kind and stepcoupon securities (securities that do not, or may not under certain circumstances, make regular interest payments). The WilliamBlair Fund may make short sales "against the box." The Fund may also use currency hedging techniques, including forward currencyexchange contracts, to manage exchange rate risk with respect to investments exposed to foreign currency fluctuations.Index/structured Securities.

In addition, the William Blair International Fund may enter into futures contracts on securities, financial indices andforeign currencies and options on such contracts and may invest in options on securities, financial indices and foreign currenciesand interest rate swaps and swap-related products (collectively "derivative instruments"). The Fund intends to use mostderivative instruments primarily to hedge the value of its portfolio against potential adverse movements in securities prices,foreign currency markets or interest rates. To a limited extent, the William Blair International Fund may also use derivativeinstruments for non-hedging purposes such as seeking to increase income. The Fund may invest in indexed/structured securities,which typically are short- to intermediate-term debt securities whose value at maturity or interest rate is linked to currencies,interest rates, equity securities, indices, commodity prices or other financial indicators. Such securities may offer growthpotential because of anticipated changes in interest rates, credit standing, currency relationships or other factors.

Although the Funds do not expect to do so ordinarily, during periods of adverse market conditions, each Fund may investall or substantially all of its assets temporarily in a defensive manner. When investing in this manner, the Funds may invest inhigh-grade, short-term, fixed-income securities (which may include U.S. Government securities) or hold its assets in cash. While aFund is in a defensive position, the opportunity to achieve its investment objective will be limited.

Fundamental investment restrictions of the Funds

As noted above, a Fund may not change a fundamental investment restriction without the prior approval of itsshareholders. A non-fundamental investment policy, however, may be changed without shareholder approval. Each Fund has adoptedfundamental investment restrictions that are identical to each other Fund. These fundamental restrictions limit a Fund's abilityto: (i) issue senior securities; (ii) borrow money (except for non-leveraging, temporary or emergency purposes); (iii) underwritesecurities; (iv) purchase or sell real estate; (v) purchase or sell physical commodities; (vi) make loans (except for certainsecurities lending transactions); and (vii) concentrate its investments by investing more than 25% of the value of the Fund'sassets in securities of issuers having their principal business activities in the same industry.

In addition, each of the Funds have adopted a fundamental investment restriction to diversify its investments.Accordingly, the Funds are considered "diversified funds" under the Investment Company Act of 1940, as amended (the "InvestmentCompany Act"). This means that, with respect to 75% of the value of each Fund's total assets, each Fund invests in cash, cashitems, obligations of the U.S. Government, its agencies or instrumentalities, securities of other investment companies and "othersecurities." The "other securities" are subject to the requirement that not more than 5% of total assets of the Fund will beinvested in the securities of a single issuer and that the Fund will not hold more than 10% of any single issuer's outstandingvoting securities. Accordingly, a Fund may not purchase the securities of any issuer if, as a result, the Fund would fail to be adiversified company within the meaning of the Investment Company Act and the rules and regulations promulgated thereunder.

Risks of investing in the Funds

Like all investments, an investment in the Funds involves risk. There is no assurance that any of the Funds will meetits investment objective. As with any mutual fund investing primarily in equity securities, the value of the securities held by aFund may decline. Stocks can decline for many reasons, including reasons related to the particular company, the industry of whichit is a part, or the securities markets generally. These declines may be substantial.

Each Fund invests primarily in equity securities of foreign companies. The level of risk of international funds willgenerally be higher than the level of risk associated with domestic equity funds. Foreign investments involve risks such asfluctuations in currency exchange rates, unstable political and economic structures, reduced availability of information, and lackof uniform financial reporting and regulatory practices such as those that apply to U.S. issuers. While none of the Funds investprimarily in companies located in developing countries, each may invest in those companies to some degree, and investment indeveloping countries may accentuate the risks of foreign investing.

In addition, there are certain risks that are associated with the particular investment strategies employed by eachFund. The DeAM International Fund invests primarily in countries included in the MSCI EAFE(R)Index and may be more exposed toadverse market conditions in those countries than a fund that invested in a broader array of countries. However, the WilliamBlair International Fund may invest a substantial portion of their assets in countries located in developing markets and may beexposed to a greater risk associated with such investments as compared to the DeAM International Fund.

The American Century International Fund and the William Blair International Fund may invest in debt securities, however,the American Century International Fund will limit its investments to investment-grade debt securities. To the extent that theWilliam Blair International Fund invests in non-investment grade debt securities, it may incur a greater risk associated with suchinvestments, such as credit risk and risk of default. In addition, the William Blair International Fund may invest in debtsecurities and derivative instruments to a greater extent that the Acquired Funds and, therefore, to the extent that the WilliamBlair International Fund makes such investments, it may incur a greater risk associated with those types of investments ascompared to the Acquired Funds.

For more information about the risks associated with the Funds' investment strategies, see the Funds' Prospectus, and fora more detailed discussion of the Funds' investments, see the Company's Statement of Additional Information, all of which areincorporated into this Proxy Statement by reference.

Federal Income Tax Considerations

Each Fund is treated as a separate entity for federal income tax purposes. Each Fund has qualified and elected orintends to qualify and elect to be treated as a "regulated investment company" under Subchapter M of the Internal Revenue Code of1986, as amended (the "Code"), and intends to continue to so qualify in the future. As a regulated investment company, a Fundmust, among other things, (a) derive at least 90% of its gross income from dividends, interest, payments with respect to loans ofstock and securities, gains from the sale or other disposition of stock, securities or foreign currency and other income(including but not limited to gains from options, futures, and forward contracts) derived with respect to its business ofinvesting in such stock, securities or foreign currency; and (b) diversify its holdings so that, at the end of each quarter of itstaxable year, (i) at least 50% of the value of the Fund's total assets is represented by cash, cash items, U.S. Governmentsecurities, securities of other regulated investment companies, and other securities limited, in respect of any one issuer, to anamount not greater than 5% of the Fund's total assets, and 10% of the outstanding voting securities of such issuer, and (ii) notmore than 25% of the value of its total assets is invested in the securities of any one issuer (other than U.S. Governmentsecurities or securities of other regulated investment companies). As a regulated investment company, a Fund (as opposed to itsshareholders) will not be subject to federal income taxes on the net investment income and capital gain that it distributes to itsshareholders, provided that at least 90% of its net investment income and realized net short-term capital gain in excess of netlong-term capital loss for the taxable year is distributed in accordance with the Code's timing requirements

The Transaction may entail various tax consequences, which are discussed under the caption "Tax Consequences of theTransaction."

Management of the Company and the Funds

American Skandia Investment Services, Inc. ("ASISI"), One Corporate Drive, Shelton, Connecticut, and PrudentialInvestments LLC ("PI"), Gateway Center Three, 100 Mulberry Street, Newark, New Jersey, serve as co-managers (each an "InvestmentManager" and together the "Investment Managers") pursuant to an investment management agreement with the Company on behalf of eachFund (the "Management Agreement"). Under the Management Agreement, PI, as co-manager, will provide supervision and oversight ofASISI's investment management responsibilities with respect to the Company. Pursuant to the Management Agreement, the InvestmentManagers will jointly administer each Fund's business affairs and supervise each Fund's investments. Subject to approval by theBoard of Directors, the Investment Managers may select and employ one or more sub-advisors for a Fund, who will have primaryresponsibility for determining what investments the Fund will purchase, retain and sell. Also subject to the approval of theBoard of Directors, the Investment Managers may reallocate a Fund's assets among sub-advisors including (to the extent legallypermissible) affiliated sub-advisors, consistent with a Fund's investment objectives.

The Company has obtained an exemption from the SEC that permits an Investment Manager to change sub-advisors for a Fundand to enter into new sub-advisory agreements without obtaining shareholder approval of the changes. Any such sub-advisor changewould be subject to approval by the Board of Directors of the Company. This exemption (which is similar to exemptions granted toother investment companies that are operated in a similar manner as the Company) is intended to facilitate the efficientsupervision and management of the sub-advisors by the Investment Managers and the Directors of the Company.

The Investment Managers currently engage the following Sub-advisors to manage the investments of each Fund in accordancewith the Fund's investment objective, policies and limitations and any investment guidelines established by the InvestmentManagers. Each Sub-advisor is responsible, subject to the supervision and control of the Investment Managers, for the purchase,retention and sale of securities in the Fund's investment portfolio under its management.

Deutsche Asset Management, Inc. ("DeAM, Inc."), 345 Park Avenue, New York, New York 10154, serves as Sub-advisor for theDeAM International Fund, as well as other series of the Company. DeAM, Inc. was founded in 1838 as Morgan Grenfell Inc. and hasprovided asset management services since 1953. As of December 31, 2002, as part of Deutsche Asset Management group, DeAM, Inc.managed approximately $90 billion of Deutsche Asset Management group's $389.3 billion in assets. David Koziol and Michael Patchenare the co-portfolio managers for the DeAM International Fund. They have been involved in the management of the DeAMInternational Fund since DeAM, Inc. became the Fund's sub-advisor in May 2002. Mr. Koziol, CFA, Director and Head of GlobalQuantitative Equities, joined DeAM, Inc. in 2001 as Head of Global Quantitative Equity Research and International PortfolioManager after 6 years of experience as a Principal in the Advanced Strategies and Research Group at Barclays Global Investors,where he developed quantitative equity fixed income and hedge fund products, and as an investment banker at Salomon Brothers Mr.Patchen, Vice President and Head of Global Quantitative Equity Portfolio Management, is responsible for managing a variety ofglobal mandates covering both traditional accounts and a market-neutral hedge fund. Mr. Patchen joined DeAM, Inc. in 2000 withfour years of experience managing global quantitative mandates including hedge funds and separate accounts at AQR CapitalManagement and Goldman Sachs Asset Management.

American Century Investment Management, Inc. ("American Century") serves as Sub-advisor for the American CenturyInternational Fund and another series of the Company. American Century, located at American Century Towers, 4500 Main Street,Kansas City, Missouri 64111, has been providing investment advisory services to investment companies and institutional clientssince 1958. As of December 31, 2002, American Century and its affiliates managed assets totaling approximately $72 billion.American Century utilizes a team of portfolio managers, assistant portfolio managers and analysts acting together to manage theassets of the American Century International Fund. The portfolio manager members of the portfolio team responsible for managementof the American Century International Fund are Keith Creveling, Henrik Strabo and Mark S. Kopinski. Keith Creveling, has been amember of the team that manages the Fund since April, 2002. He joined American Century in 1999 as an analyst. Prior to that, Mr.Creveling was an analyst at Fiduciary Trust Company International from September 1996 until September 1999. Henrik Strabo joinedAmerican Century in 1993 as an investment analyst, has been a portfolio manager member of the international team since 1994 andhas managed the Fund since American Century became the Fund's Sub-advisor in May 2000. Mark S. Kopinski, Vice President andPortfolio Manager for American Century, rejoined American Century in April 1997 and has co-managed the Fund since American Centurybecame the Fund's Sub-advisor. From June 1995 to March 1997, Mr. Kopinski served as Vice President and Portfolio Manager forFederated Investors, Inc.

William Blair & Company, L.L.C. ("William Blair"), located at 222 West Adams Street, Chicago, Illinois 60606, serves asSub-advisor to the William Blair International Fund. Since its founding in 1935, the firm has been dedicated to researching,financing and investing in high quality growth companies through four primary divisions: investment banking, sales and trading,asset management and private capital. As of December 31, 2002, William Blair managed approximately $11.9 billion in assets. Theportfolio manager responsible for the day-today management of the William Blair International Fund is W. George Greig. Mr. Greigis a principal of William Blair and joined the firm in 1996 as an international portfolio manager and has managed the Fund sinceWilliam Blair became its sub-advisor in November 2002.

Fee Arrangements

Pursuant to the Management Agreement, ASISI receives a monthly investment management fee for the performance of itsservices. The investment management fee is accrued daily for the purposes of determining the sale and redemption price of aFund's shares. ASISI pays each Sub-advisor a portion of such fee for the performance of the sub-advisory services at no additionalcost to a Fund.

Under the Management Agreement with respect to the DeAM International Fund, the Fund is obligated to pay ASISI an annualinvestment management fee equal to 1.10% of its average daily net assets. Under the Management Agreement with respect to theAmerican Century International Fund, the Fund is obligated to pay ASISI an annual investment management fee equal to 1.00% of itsaverage daily net assets. Under the Management Agreement with respect to the William Blair International Fund, the Fund isobligated to pay ASISI an annual investment management fee equal to 1.00% of its average daily net assets. The investmentmanagement fee rate for the shareholders of the DeAM International Fund will be lower as a result of the Transaction while theinvestment management fee rate for the shareholders of the American Century International Fund will not change as a result of theTransaction. During the calendar year ended December 31, 2002, the DeAM International Fund paid $636,052 in investment managementfees to ASISI. If the fee rate applicable to the William Blair International Fund had been in effect during such period, the DeAMInternational Fund would have paid $630,083 in investment management fees to ASISI.* During the calendar year ended December 31,2002, the American Century International Fund paid $633,808 in investment management fees to ASISI. If the fee rate applicable tothe William Blair International Fund had been in effect during such period, the American Century International Fund would havepaid $690,646 in investment management fees to ASISI.*

The Investment Manager has voluntarily agreed until March 1, 2004 to reimburse each Fund for its respective operatingexpenses, exclusive of taxes, interest, brokerage commissions, distribution fees and extraordinary expenses, but inclusive of themanagement fee, which in the aggregate exceed specified percentages of a Fund's average net assets as follows: DeAM InternationalFund, 1.70%; American Century International Fund, 1.60%; and William Blair International Fund, 1.60%. The Investment Manager mayterminate the above voluntary agreements at any time after March 1, 2004. Voluntary payments of Fund expenses by the InvestmentManager may be made subject to reimbursement by the Fund, at the Investment Manager's discretion, within the two year periodfollowing such payment to the extent permissible under applicable law and provided that the Fund is able to effect suchreimbursement and remain in compliance with applicable expense limitations.

* From January 1, 2002 to November 10, 2002, the advisory fee for William Blair International Growth was 1.10%. From November 11,2002 to December 31, 2002, the advisory fee was reduced to 1.00%.

ASISI pays each Sub-advisor a portion of the investment management fee that ASISI receives from each Fund. ASISI payssuch sub-advisory fees without any additional expense to a Fund. The Funds have comparable sub-advisory fee arrangements. Withrespect to the DeAM International Fund, ASISI pays DeAM 0.30% of the portion of the combined average daily net assets not inexcess of $500 million; plus 0.25% of the portion over $500 million but not in excess of $1 billion; plus 0.20% of the portionover $1 billion.

With respect to the American Century International Fund, ASISI pays American Century an annual rate equal to AmericanCentury 0.45% of the portion of the average daily net assets of the Fund not in excess of $50 million; plus 0.40% of the portionover $50 million but not in excess of $100 million; plus 0.35% of the portion over $100 million but not in excess of $500 million;plus 0.30% of the portion over $500 million.

With respect to the William Blair International Fund, ASISI pays William Blair an annual rate equal to 0.30% of theportion of the combined average daily net assets not in excess of $500 million; plus 0.25% of the portion over $500 million butnot in excess of $1 billion; plus 0.20% of the portion in excess of $1 billion. Consequently, the shareholders of the DeAMInternational Fund will pay an investment management fee at a lesser rate as a result of the Transaction.

Accordingly, at all asset levels, ASISI will be required to pay a lesser portion of its investment management fees forsub-advisory services in respect of the American Century International Fund assets. ASISI will be required to pay the sameportion of its investment management fees for sub-advisory services in respect of the DeAM International Fund.

Distribution Plan

The Company adopted a Distribution and Service Plan (commonly known as a "12b-1 Plan") for each class of shares tocompensate the Funds' distributor for its services and costs in distributing shares and servicing shareholder accounts. Under theDistribution and Service Plan for Class A shares, each Fund pays the distributor 0.50% of the Fund's average daily net assetsattributable to Class A shares. Under the Plans for Class B, X and C shares, each Fund pays the distributor 1.00% of the Fund'saverage daily net assets attributable to the relevant Class of shares. Because these fees are paid out of the Funds' assets on anongoing basis, these fees may, over time, increase the cost of an investment in the Fund and may be more costly than other typesof sales charges. The distributor uses distribution and service fees received under each 12b-1 Plan to compensate qualifieddealers for services provided in connection with the sale of shares and the maintenance of shareholder accounts. Thedistributor's rights to distribution and service fees received under the Class B 12b-1 Plan and the Class X 12b-1 Plan have beenassigned to third parties.

Valuation

The net asset value ("NAV") per share is determined for each class of shares for each Fund as of the time of the close ofthe New York Stock Exchange ("NYSE") (which is normally 4:00 p.m. Eastern time) on each business day by dividing the value of theFund's total assets attributable to a class, less any liabilities, by the number of total shares of that class outstanding. Ingeneral, the assets of each Fund are valued on the basis of market quotations. However, in certain circumstances where marketquotations are not readily available or where market quotations for a particular security or asset are believed to be incorrect,securities and other assets are valued by methods that are believed to accurately reflect their fair value.

Purchases, Redemptions, Exchanges and Distributions

The purchase policies for each Fund are identical. The offering price is the NAV per share plus any initial sales chargethat applies. Class A shares are sold at NAV plus an initial sales charge that varies depending on the amount of yourinvestment. Class B shares are sold at NAV per share without an initial sales charge. However, if Class B shares are redeemedwithin seven years of their purchase, a contingent deferred sales charge ("CDSC") will be deducted from the redemption proceeds.Class C shares are sold at NAV per share plus an initial sales charge of 1% of the offering price. If Class C shares are redeemedwithin 12 months of the first business day of calendar month of their purchase, a CDSC of 1.0% will be deducted from theredemption proceeds. Class X shares are sold at NAV per share without an initial sales charge. In addition, investors purchasingClass X shares will receive, as a bonus, additional shares having a value equal to 2.50% of the amount invested. Although Class Xshares are sold without an initial sales charge, if Class X shares are redeemed within 8 years of their purchase, a CDSC will bededucted from the redemption proceeds.

The redemption policies for each Fund are identical. Your shares will be sold at the next NAV per share determined afteryour order to sell is received, less any applicable CDSC imposed. Refer to the Funds' Prospectus for more information regardinghow to sell shares.

Shares of each Fund may be exchanged for shares of the same class of other Funds and other funds of the Company at NAVper share at the time of exchange. Exchanges of shares involve a redemption of the shares of the Fund you own and a purchase ofshares of another fund. Shares are normally redeemed and purchased in the exchange transaction on the business day on which theTransfer Agent receives an exchange request that is in proper form, if the request is received by the close of the NYSE that day.

Each Fund will distribute substantially all of its income and capital gains to shareholder each year. Each Fund willdeclare dividends, if any, annually.

Fees and expenses

The following table describes the fees and expenses that shareholders may pay if they hold shares of the DeAMInternational Fund and the William Blair International Fund, as well as the projected fees and expenses of the William BlairInternational Fund after the Transaction.

Class A Shares -------------- DeAM Wm Blair Wm Blair International ----- --------- ---------------------- International International Growth Fund -------------- -------------- ----------- Equity Fund Growth Fund After Transaction ------------ ------------ ----------------- Class A Class A Class A ------- ------- -------Shareholder Fees(fees paid directly from your investment)

Maximum Sales Charge (Load) on Purchases (as % of offering price) 5.75% 5.75% 5.75% Maximum Contingent Deferred Sales Charge (Load) (as % of original purchase price) None1 None1 None1 Redemption Fee................................. None2 None2 None2 Exchange Fee................................... None None None

Annual Fund Operating Expenses(expenses that are deducted from Fund assets)

Management Fees............................ 1.10% 1.06%4 1.06%4 Estimated Distribution (12b-1) Fees........ 0.50% 0.50% 0.50% Other Expenses............................. 1.50% 0.89% 0.97% Advisory Fee Waivers and Expense Reimbursement (0.90)% (0.35)% (0.43)% Total Annual Fund Operating Expenses....... 2.20% 2.10% 2.10%

Class B Shares --------------

Wm Blair -------- DeAM Wm Blair International Growth ----- --------- -------------------- International International Fund -------------- -------------- ---- Equity Fund Growth Fund After Transaction ------------ ------------ ----------------- Class B Class B Class B ------- ------- -------Shareholder Fees(fees paid directly from your investment)

Maximum Sales Charge (Load) On Purchases (as % of offering price) None None None Maximum Contingent Deferred Sales Charge (Load) (as % of original purchase price) 6.00%3 6.00%3 6.00%3 Redemption Fee................................. None2 None2 None2 Exchange Fee................................... None None None



Class C Shares --------------

Wm Blair -------- DeAM Wm Blair International Growth ----- --------- -------------------- International International Fund -------------- -------------- ---- Equity Fund Growth Fund After Transaction ------------ ------------ ----------------- Class C Class C Class C ------- ------- -------Shareholder Fees(fees paid directly from your investment)

Maximum Sales Charge (Load) on Purchases (as % of offering price) 1.00% 1.00% 1.00% Maximum Contingent Deferred Sales Charge (Load) (as % of original purchase price) 1.00%3 1.00%3 1.00%3 Redemption Fee................................. None2 None2 None2 Exchange Fee................................... None None None



Class X Shares --------------

Wm Blair -------- DeAM Wm Blair International Growth ----- --------- -------------------- International International Fund -------------- -------------- ---- Equity Fund Growth Fund After Transaction ------------ ------------ ----------------- Class X Class X Class X ------- ------- -------Shareholder Fees(fees paid directly from your investment)

Maximum Sales Charge (Load) on Purchases (as % of offering price) None None None Maximum Contingent Deferred Sales Charge (Load) (as % of original purchase price) 6.00%3 6.00%3 6.00%3 Redemption Fee................................. None2 None2 None2 Exchange Fee................................... None None None



1. Under certain circumstances, purchases of Class A shares not subject to an initial sales charge (load) will be subject to acontingent deferred sales charge (load) ("CDSC") if redeemed within 12 months of the calendar month of purchase. For anadditional discussion of the Class A CDSC, see this Prospectus under "How to Buy Shares."2. A $10 fee may be imposed for wire transfers of redemption proceeds. For an additional discussion of wire redemptions, seethis Prospectus under "How to Redeem Shares."3. If you purchase Class B or X shares, you do not pay an initial sales charge but you may pay a CDSC if you redeem some or allof your shares before the end of the seventh (in the case of Class B shares) or eighth (in the case of Class X shares) year afterwhich you purchased such shares. The CDSC is 6%, 5%, 4%, 3%, 2%, 2% and 1% for redemptions of Class B shares occurring in yearsone through seven, respectively. The CDSC is 6%, 5%, 4%, 4%, 3%, 2%, 2% and 1% for redemptions of Class X shares occurring inyears one through eight, respectively. No CDSC is charged after these periods. If you purchase Class C shares, you may pay aninitial sales charge of 1% and you may incur a CDSC if you redeem some or all of your Class C shares within 12 months of thecalendar month of purchase. For a discussion of the Class B, X and C CDSC, see this Prospectus under "How to Buy Shares."4. From May 1, 2002 to November 10, 2002, the advisory fee for William Blair International Growth was 1.10%. From November 11,2002 to April 30, 2003, the advisory fee was reduced to 1.00%.

Fees and expenses

The following table describes the fees and expenses that shareholders may pay if they hold shares of the American CenturyInternational Fund and the William Blair International Fund, as well as the projected fees and expenses of the William BlairInternational Fund after the Transaction.

Class A Shares --------------

Wm Blair -------- American Century Wm Blair International Growth ----------------- --------- -------------------- International International Fund -------------- -------------- ---- Growth Fund Growth Fund After Transaction ------------ ------------ ----------------- Class A Class A Class A ------- ------- -------Shareholder Fees(fees paid directly from your investment)

Maximum Sales Charge (Load) on Purchases (as % of offering price) 5.75% 5.75% 5.75% Maximum Contingent Deferred Sales Charge (Load) (as % of original purchase price) None1 None1 None1 Redemption Fee................................. None2 None2 None2 Exchange Fee................................... None None None


Management Fees.......................... 1.00% 1.06%4 1.06%4 Estimated Distribution (12b-1) Fees............. 0.50% 0.50% 0.50% Other Expenses.................................. 1.67% 0.89% 0.92% Advisory Fee Waivers and Expense Reimbursement (1.07)% (0.35)% (0.38)% Total Annual Fund Operating Expenses............ 2.10% 2.10% 2.10%

Class B Shares -------------- Wm Blair -------- American Century Wm Blair International Growth ----------------- --------- -------------------- International International Fund -------------- -------------- ---- Growth Fund Growth Fund After Transaction ------------ ------------ ----------------- Class B Class B Class B ------- ------- -------Shareholder Fees(fees paid directly from your investment)

Maximum Sales Charge (Load) on Purchases (as % of offering price) None None None Maximum Contingent Deferred Sales Charge (Load) (as % of original purchase price) 6.00%3 6.00%3 6.00%3 Redemption Fee................................. None2 None2 None2 Exchange Fee................................... None None None




American Wm Blair --------- -------- Centurty Wm Blair International Growth --------- --------- -------------------- International International Fund -------------- -------------- ---- Growth Fund Growth Fund After Transaction ------------ ------------ ----------------- Class C Class C Class C ------- ------- -------Shareholder Fees(fees paid directly from your investment)

Maximum Sales Charge (Load) On Purchases (as % of offering price) 1.00% 1.00% 1.00% Maximum Contingent Deferred Sales Charge (Load) (as % of original purchase price) 1.00%3 1.00%3 1.00%3 Redemption Fee................................. None2 None2 None2 Exchange Fee................................... None None None




Wm Blair -------- American Century Wm Blair International Growth ----------------- --------- -------------------- International International Fund -------------- -------------- ---- Growth Fund Growth Fund After Transaction ------------ ------------ ----------------- Class X Class X Class X ------- ------- -------Shareholder Fees(fees paid directly from your investment)

Maximum Sales Charge (Load) On Purchases (as % of offering price) None None None Maximum Contingent Deferred Sales Charge (Load) (as % of original purchase price) 6.00%3 6.00%3 6.00%3 Redemption Fee................................. None2 None2 None2 Exchange Fee................................... None None None



1. Under certain circumstances, purchases of Class A shares not subject to an initial sales charge (load) will be subject to acontingent deferred sales charge (load) ("CDSC") if redeemed within 12 months of the calendar month of purchase. For anadditional discussion of the Class A CDSC, see this Prospectus under "How to Buy Shares."2. A $10 fee may be imposed for wire transfers of redemption proceeds. For an additional discussion of wire redemptions, seethis Prospectus under "How to Redeem Shares."3. If you purchase Class B or X shares, you do not pay an initial sales charge but you may pay a CDSC if you redeem some or allof your shares before the end of the seventh (in the case of Class B shares) or eighth (in the case of Class X shares) year afterwhich you purchased such shares. The CDSC is 6%, 5%, 4%, 3%, 2%, 2% and 1% for redemptions of Class B shares occurring in yearsone through seven, respectively. The CDSC is 6%, 5%, 4%, 4%, 3%, 2%, 2% and 1% for redemptions of Class X shares occurring inyears one through eight, respectively. No CDSC is charged after these periods. If you purchase Class C shares, you may pay aninitial sales charge of 1% and you may incur a CDSC if you redeem some or all of your Class C shares within 12 months of thecalendar month of purchase. For a discussion of the Class B, X and C CDSC, see this Prospectus under "How to Buy Shares."4. From May 1, 2002 to November 10, 2002, the advisory fee for William Blair International Growth was 1.10%. From November 11,2002 to April 30, 2003, the advisory fee was reduced to 1.00%.

Expense Examples

Full Redemption - These examples are intended to help you compare the cost of investing in the DeAM International Fund and theWilliam Blair International Fund with the cost of investing in other mutual funds, and the cost of investing in the William BlairInternational Fund after the Transaction. They assume that you invest $10,000, that you receive a 5% return each year, and thatthe Funds' total operating expenses remain the same. Although your actual costs may be higher or lower, based on the aboveassumptions your costs would be:


1 Year 3 Years 5 Years 10 Years ------ ------- ------- --------DeAM International Equity Fund 785 1,397 2,033 3,731William Blair International Growth Fund 776 1,263 1,776 3,176William Blair International Growth Fund 776 1,279 1,807 3,245(Projected after the Transaction)




1 Year 3 Years 5 Years 10 Years ------ ------- ------- --------DeAM International Equity Fund 470 1,110 1,870 3,866William Blair International Growth Fund 460 971 1,607 3,314William Blair International Growth Fund 460 987 1,638 3,383(Projected after the Transaction)



Full Redemption - These examples are intended to help you compare the cost of investing in the American Century International Fundand the William Blair International Fund with the cost of investing in other mutual funds, and the cost of investing in theWilliam Blair International Fund after the Transaction. They assume that you invest $10,000, that you receive a 5% return eachyear, and that the Funds' total operating expenses remain the same. Although your actual costs may be higher or lower, based onthe above assumptions your costs would be:


1 Year 3 Years 5 Years 10 Years ------ ------- ------- --------American Century International Growth Fund 776 1,402 2,051 3,781William Blair International Growth Fund 776 1,263 1,776 3,176William Blair International Growth Fund 776 1,269 1,787 3,202(Projected after the Transaction)


1 Year 3 Years 5 Years 10 Years ------ ------- ------- --------American Century International Growth Fund 863 1,425 2,007 3,745William Blair International Growth Fund 863 1,280 1,722 3,129William Blair International Growth Fund 863 1,286 1,734 3,155(Projected after the Transaction)


1 Year 3 Years 5 Years 10 Years ------ ------- ------- --------American Century International Growth Fund 460 1,115 1,889 3,916William Blair International Growth Fund 460 971 1,

n-14 wm blair - sec.gov | home no. 333-108399 as filed on october 29, 2003 u.s. securities and...

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